Notes to the Condensed Consolidated Financial Statements (unaudited)
The contractual maturities of the Corporation’s financial obligations, including interest payments and the impact of netting agreements, as at September 30, 2021 were as follows:
Contractual Maturities
Carrying Amount
Less Than
1 - 2
3 - 5
More Than
(millions)
1 Year
Years
Years
5 Years
Bank indebtedness Short-term debt
$
1
$
1
$
- - - -
$
- - - -
$
- - - -
287 121
287 121
Trade and other payables
Dividends payable Long-term debt
2
2
1,535
58
58 11
335
2,188
Derivative instruments
(61)
(3)
6
16
Commitments
82
82
-
-
-
$
1,967
$
548
$
69
$
341
$
2,204
As at September 30, 2021, the Corporation’s borrowing capacity, together with relatively stable operating cash flows, provide sufficient liquidity to fund these contractual obligations. Interest rates used in calculating financial obligations are effective September 30, 2021. The Corporation has also posted a $15 million (2020 - $15 million) letter of credit with ICE NGX as security for natural gas purchases and sales conducted by the Corporation on the ICE NGX natural gas exchange in Alberta. ICE NGX may draw upon the letter of credit if the Corporation fails to make timely payment for, or delivery of, natural gas as per the related contract. In addition to the above, the Corporation has posted a Parental Guarantee Agreement with Many Islands Pipe Lines (Canada) Limited (MIPL), one of its subsidiaries, in the amount of $200 million. Guaranteed funds are for any amounts that may be due by MIPL under the Canadian Energy Regulator Act. c. Credit risk Credit risk is the risk of financial loss if a customer or counterparty to a financial or derivative instrument fails to meet its contractual obligations. The Corporation is exposed to credit risk through cash, trade and other receivables, debt retirement funds and derivative instrument assets. Credit risk related to cash and debt retirement funds is minimized by dealing with institutions that have strong credit ratings and holding highly-rated financial securities. The Corporation extends credit to its customers in the normal course of business and is at risk of loss in the event of non-performance by counterparties on certain of the financial and derivative instruments. To reduce its credit risk, the Corporation has established policies and procedures to monitor and limit the amount of credit extended to its customers and counterparties and may require letters of credit and other forms of security.
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